Canadian Phoenix Resources Corp.
TSX VENTURE : CPH

Canadian Phoenix Resources Corp.

August 11, 2008 20:52 ET

Canadian Phoenix Completes $12 Million First Tranche of Non-Brokered Private Placement Financing

CALGARY, ALBERTA--(Marketwire - Aug. 11, 2008) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES

CANADIAN PHOENIX RESOURCES CORP. ("Canadian Phoenix") (TSX VENTURE:CPH) is pleased to announce that it has completed a first tranche non-brokered private placement of 80,344,500 subscription receipts ("Subscription Receipts") at the price of $0.15 per Subscription Receipt for gross proceeds of $12,051,675 (the "Offering"). Canadian Phoenix may complete one or more additional closings of the private placement of Subscription Receipts, including a second tranche to be completed on or before August 15, 2008, at which time Thomas P. Stan, President and Chief Executive Officer of Canadian Phoenix, is expected to purchase 1,666,667 Subscription Receipts ($250,000). Each Subscription Receipt will be deemed to be exchanged, without payment of any additional consideration, for one unit ("Unit") of the Corporation upon the Escrow Release Date (as defined below). Each Unit will consist of one common share ("Common Share") of Canadian Phoenix and one Common Share purchase warrant ("Warrant"). Each Warrant entitles the holder thereof to purchase one Common Share during the period expiring on the second anniversary of the Escrow Release Date (as defined below) upon payment of the exercise price of $0.20 per Common Share. If the closing price of the Common Shares on the TSX Venture Exchange is at least $0.30 for a minimum of at least 30 trading days, Canadian Phoenix may reduce the exercise period to that date which is 30 days following the date on which the Warrant holders receive notice of the shortened exercise period. The securities issued pursuant to the Offering, including the common shares of Canadian Phoenix issuable upon exercise of the Warrants, are subject to a restricted resale period expiring December 9, 2008.

The gross proceeds received on the Offering have been deposited in escrow, such escrowed funds to be released on the date that all of the conditions to the completion of the transaction with Marble Point Energy Ltd. ("Marble Point") relating to the acquisition of 90 million class "A" common voting shares of Marble Point by Canadian Phoenix through a series of transactions, (the "Marble Point Transaction") are met or waived ("Escrow Release Date"). If the Escrow Release Date does not occur on or before December 1, 2008 (the "Final Escrow Deadline"), such escrowed funds plus interest will be returned pro rata to each holder of the Subscription Receipts in exchange for the cancellation of the Subscription Receipts of such holder. The proceeds of the Offering will be used to fund, in part, the Marble Point Transaction. For more information regarding the conditions to the Marble Point Transaction, see Canadian Phoenix's management information circular dated June 30, 2008, which is available at www.sedar.com.

On the Escrow Release Date, finders acting in connection with the Offering will, subject to acceptance by the TSX Venture Exchange, receive a finder's fee of that number of Units, with each Unit consisting of one Common Share and one Warrant, equal to 5.5% of the number of Subscription Receipts issued under the Offering. The Common Shares, Warrants and the common shares of Canadian Phoenix issuable upon exercise of the Warrants, are also subject to a restricted resale period that will expire on the day following the fourth month anniversary of the Escrow Release Date. The completion of the Offering is subject to regulatory approval.

Canadian Phoenix Resources Corp. is a publicly traded junior oil and gas exploration, development and production company with operations in Western Canada. Canadian Phoenix is pursuing a corporate strategy of being a consolidator of undervalued oil and gas assets located in the Western Canadian Sedimentary Basin. Canadian Phoenix's shares trade on the TSX Venture Exchange under the symbol "CPH". Canadian Phoenix currently has 583,601,540 Common Shares issued and outstanding.

ON BEHALF OF THE BOARD OF DIRECTORS OF CANADIAN PHOENIX RESOURCES CORP.

Thomas Stan, President & CEO

This news release does not constitute an offer to sell or the solicitation of an offer to buy the Units, Common Shares or Warrants within the United States. The Units, Common Shares and Warrants have not been and will not be registered under the United States Securities Act of 1933, as amended (the "1933 Act"), or any state securities laws. Accordingly, none of the Units, Common Shares or Warrants may be offered or sold in the United States or to U.S. persons (as such terms are defined in Regulation S under the 1933 Act) unless registered under the 1933 Act and applicable state securities law or an exemption from such registration is available.

Forward-Looking Statements

This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. More particularly and without limitation, this news release contains forward looking statements and information concerning completion of the transactions with Marble Point Energy Ltd. The forward-looking statements and information are based on certain key expectations and assumptions made by Canadian Phoenix, including expectations and assumptions concerning prevailing commodity prices and exchange rates, applicable royalty rates and tax laws, future well production rates and reserve volumes, receipt of regulatory and security holder approvals, the performance of existing wells, the success obtained in drilling new wells, the sufficiency of budgeted capital expenditures in carrying out planned activities, the availability and cost of labour and services and the impact of the Province of Alberta's new royalty regime. Although Canadian Phoenix believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward looking statements and information because Canadian Phoenix can give no assurance that they will prove to be correct. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production delays or changes in plans with respect to exploration or development projects or capital expenditures, the uncertainty of reserve estimates, the uncertainty of estimates and projections relating to reserves, production, costs and expenses, health, safety and environmental risks, commodity price and exchange rate fluctuations, marketing and transportation, loss of markets, environmental risks, competition, incorrect assessment of the value of acquisitions, failure to realize the anticipated benefits of acquisitions, ability to access sufficient capital from internal and external sources, failure to obtain required regulatory and other approvals, and changes in legislation, including but not limited to tax laws, royalties and environmental regulations.
There are risks also inherent in the nature of the transactions with Marble Point Energy Ltd., including incorrect assessment of the value of the assets to be acquired, and failure to obtain the required security holder, regulatory and other third party approvals. Readers are cautioned that the foregoing list of factors is not exhaustive. The forward-looking statements and information contained in this news release are made as of the date hereof and Canadian Phoenix undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

The TSX Venture Exchange has neither approved nor disapproved the contents of this news release.

Contact Information

  • Canadian Phoenix Resources Corp.
    400E, 311 - 6th Avenue S.W.
    Calgary, AB T2P 3H2
    (403) 920-0040
    (403) 920-0043 (FAX)